Symrise has recorded “excellent organic sales growth” of 8.3% in its third quarter results, and the company has once again raised its sales forecast for 2021.
The German flavor house reports that the increase in out-of-home consumption exerted a positive impact and led to strong demand for beverages.
Demand bolstered by COVID-19
Dr. Heinz-Jürgen Bertram, CEO of Symrise, says, “We can look back on an exceptionally successful third quarter of 2021.”
As a result of the progress made in battling the COVID-19 pandemic, demand has continued to increase significantly, he notes.
Demand was exceptionally high for applications associated with travel or leisure activities – including, for example, beverages and culinary products.
“We are extremely satisfied with our business development since the beginning of the year, and we are continuing our accelerated growth path,” explains Bertram.
“We are once again raising our sales forecast to around 9%. We are confident that we can achieve even more growth than forecasted after six months, and we will make the best possible use of the remaining weeks in 2021 to achieve this target.”
Beverages boost Flavor & Nutrition
The Flavor & Nutrition segment increased organic sales by a strong 10.0% compared to the previous year. In Q3, organic growth amounted to 9.7%, Symrise reveals.
Segment sales increased to €1.7 billion (US$2 billion). Flavor & Nutrition also saw a normalization of consumer behavior despite the pandemic.
Applications for beverages recorded sales growth in the double-digit range. Growth was mainly driven by the strong increase in demand for beverages designed for out-of-home consumption in all markets.
Sales in the company’s Savory business unit in all regions slightly exceeded the exceptionally high prior-year level, characterized by the particularly high demand during the initial months of the COVID-19 crises.
Sweet sales take a dip
Sales for sweet product solutions were slightly below the prior year’s level.
Medium single-digit growth driven by new customers in Latin America and Asia/Pacific was offset by the current low price level for vanilla, says Symrise.
The Food business unit achieved modest organic growth. This was driven by rising sales in Western Europe, while sales in North America declined slightly.
The ADF/IDF Group also developed exceptionally well, achieving double-digit organic sales growth. The business recorded strong growth in its home market, the American domestic market.
The Probiotics business unit, including the majority shareholding in the Swedish company Probi AB, did not maintain the strong level of the previous year and recorded a slight decline in sales.
Meeting industry demand
Symrise believes it is robustly positioned despite the ongoing challenging market environment with its global presence, its continually growing, diversified portfolio, and its broad customer base.
Based on the positive business development in the first nine months, Symrise is raising the sales target again and now expects organic growth of around 9% for the full year 2021.
This corresponds to an increase of around two percentage points compared to the raised forecast of 7% in August 2021.
Symrise highlights its aspiration to “significantly outperform growth in the relevant market for fragrances and flavors during the current financial year.” In the current business environment, current estimates assume market growth of 3 to 4%.
Taking into account the portfolio effect from the acquired fragrances business of Sensient as well as currency translation effects, group sales rose to €2.8 billion (US$3.3 billion) during the reporting period, up 6.7% compared to the prior-year period and 10.6% in Q3.
Both segments contributed to this positive result, says Symrise. In the first nine months of the current financial year, growth even amounted to 9.2%.
In the first half of 2021, Symrise performed “outstandingly well.” As pandemic-related pressures eased, the company’s sales and earnings increased substantially.
In April, Symrise hailed a “dynamic start” to the business year and saw an organic increase of sales by 10.5% in the first quarter of 2021.
Meanwhile, the company also recently unveiled development, application and sensory laboratories in Dubai. The company invested around €1 million (US$1.2 million) into the facilities to decode, design and deliver taste solutions for F&B brands in the regions of the Middle East, Pakistan and parts of Africa.
